It’s “possible” that oil will hit $100 a barrel this winter, but $80 to $90 is the expected range, said Marco Dunand, the chief executive officer of commodities trader Mercuria Energy Group Ltd.
With surging energy costs contributing to inflation, as the global economy recovers from the pandemic, prices could still go higher.
“It’s difficult to think the psychology of the market can be anything but bullish ahead of the winter,” he said. “We have a bullish view on commodities and on energy.”
Global climate talks that will kick off in Glasgow later this month come at a difficult time, as world leaders balance their climate ambitions with their current reliance on fossil fuels to power their economies. That conundrum is particularly acute for China, the world’s biggest developer of renewable power and the biggest polluter, Dunand said.
“China’s in a complicated place,” he said. “They made an effort to reduce coal production and now there’s panic because there’s not sufficient inventory either of gas or coal.”
Still, Dunand believes China’s leaders want to move aggressively to cut emissions.